Legal Question in Business Law in Michigan
Company Buy-out
My husband has been a 30% owner in a retail business for the last 21 years. As the only active principal he grew this from annual receipts of $50,000 to $2,500,000.
Several months ago, he began negotiations to buy-out the inactive owner. All offers were refused, as this man wanted to let his son-in-law run the business.
Instead, my husband agreed to a verbal offer for his share of the business. Thinking after all these years that he could rely on this man's word, he left the employment before payment terms- time frame, guarantees, etc. were finalized.
After several weeks of trying to bring this matter to a conclusion, we suddenly hear from the other owner's attorney informing us that we're getting...nothing! We're left with only our shares in the company - which will shortly be worthless after the son-in-law runs the business into the ground.
How can we get our fair share out of this company?
1 Answer from Attorneys
Re: Company Buy-out
None of this sounds very good. Were there any terms to the verbal agreement? Also, what was said by the partner's attorney? Finally, I need to know a bit about the business structure (i.e., corporation, LLC, partnership, etc.). Unfortunately, it sounds like you should quickly consider that litigation might be the only way to adequately protect your husband's interests. It seems that he might be able to enforce the verbal agreement (if there were sufficient terms described) or at least push for the appointment of a receiver by the court to run the business while everything is being sorted out. There are several different theories of recovery that might be applicable to this case, but more information is needed. If you wish to discuss this further, please feel free to contact our office and ask for Shaheen Imami (248.865.8810) or you may e-mail me directly at [email protected]. In any event, good luck.
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